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<p>[QUOTE=&quot;Cloudsweeper99, post: 1089311, member: 3011&quot;]I take it another step and distinguish between fiscal and monetary factors.&nbsp; Government spending and debt are fiscal matters.&nbsp; High levels of debt tend to be deflationary since the debt has to be serviced from current income and either paid or defaulted.&nbsp; On the monetary side, the Fed can choose to monetize the debt, or not.&nbsp; Right now they are attempting a partial monitization, a sort of middle ground to avoid either deflation or hyperinflation.&nbsp; Will it work?&nbsp; Nobody knows [but there are a lot of opinions out there].&nbsp; The Federal Government cannot cause hyperinflation since they must borrow or tax to spend -- an &quot;even&quot; exchange in the GDP formula. Only the Fed can hyperinflate but the Fed Board of Governors realizes that this would not be a smart thing either economically or personally for them to do.[/QUOTE]</p><p><br /></p>

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